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Bezos: Amazon Team 'Working Its Butts Off' to Decide on HQ2 Location

World's Richest Person Tells D.C. Crowd The Online Giant Is Still Vetting City Finalists
September 14, 2018
Jeff Bezos, CEO and founder of Amazon, was the guest speaker at The Economic Club of Washington, D.C. on Thursday.

Jeffrey P. Bezos, Amazon founder and chief executive, did not tell people what they wanted to hear Thursday night.

The e-commerce billionaire didn’t have an announcement about where Seattle-based Amazon plans to locate its so-called "HQ2," a second headquarters, during an interview before an audience of roughly 1,550 people at a dinner in Washington, D.C. Instead, he said that Amazon is still in the process of making a choice.

"It’s very simple," Bezos said. "We will announce a decision before the end of this year. So we’ve made tremendous progress and the team is working its butts off on it and we will get there."

When some audience members booed, Bezos said, "No no, be nice," sparking laughter.

 Read More CoStar Amazon HQ2 Coverage 

The world’s richest person was the guest speaker at the event hosted by the Economic Club of Washington, talking to an audience that was a mix of business, commercial real estate and government officials. David Rubenstein, president of the Economic Club and co-founder of the private equity giant Carlyle Group, spent more than an hour interviewing Bezos on a wide array of topics, including the entrepreneur’s belief in brick-and-mortar stores, despite his company’s origins in e-commerce.

Amazon is at the center of what is arguably one of the biggest commercial real estate stories this year: Where will it bring 50,000 employees and $5 billion in capital spending after narrowing down the field to 20 cities in January?

The Washington area has a lot of skin in the game, with Northern Virginia, Maryland's Montgomery County, and the District itself all on the final-20 list, hence the extra-large turnout for the Economic Club’s Milestone Celebration dinner, which commemorated the organization’s 32nd anniversary. Bezos already has ties to the nation’s capital, as owner of the hometown paper, The Washington Post.

The local HQ2 finalists were well-represented at the Economic Club event. The dignitaries in attendance at the Washington Hilton included D.C. Mayor Muriel Bowser, Maryland Gov. Larry Hogan, and even the ambassadors of 17 nations. Virginia Gov. Ralph Northam was slated to attend the event, but cancelled to tend to duties in his state, as it prepared for the arrival of Hurricane Florence. Bezos’ parents, Mike and Jackie Bezos, were also on hand for the festivities.

Before the dinner started, Hogan told CoStar News that he didn’t expect Bezos to reveal where HQ2 would be that evening.

"I think it’s on everybody’s mind and we all wish that we had an answer," Hogan said. "But they have said they will make a decision by year-end. I will be sitting with Jeff Bezos, across from him, along with David Rubenstein, so I’ll get a chance to talk to him one-on-one. But I’m not sure he’s going to spill the beans tonight ... But we think we have a great proposal for Maryland. Maryland, Virginia and the District of Columbia are all on the short list ... It’s a tremendous opportunity."

Under questioning by Rubenstein, Bezos said that all his best decisions, "in business and in life, have been made with heart, intuition, guts --- not, not an analysis." That provided Rubenstein with a segue to ask about HQ2.

"You use your intuition to make decisions, where is the intuition leading you now on your second headquarters?" Rubenstein asked Bezos, sparking a loud burst of applause, cheers and whistles from the audience.

It was then that Bezos responded that the HQ2 evaluation process was ongoing.

After saying that Amazon has "revolutionized retail," Rubenstein questioned Bezos about why Amazon decided to acquire Whole Foods Market, the brick-and-mortar chain of organic-food grocery stores.

"We’re very interested in physical stores ... but only when we have a differentiated offering, something that’s not ‘me-too,’" Bezos said. "And we have ideas about how to merge Prime and Whole Foods ... to use Amazon Prime to make Whole Foods a very differentiated space."

Amazon Prime is a subscription service giving customers access to free shipping, music, movies and more.

Amazon’s success in keep a tight lid on its HQ2 hunt has impressed some observers. That secrecy continued Thursday night. Bezos declined to speak to the press after his interview by Rubenstein. Reporters covering the dinner were given oversized tags, with the word "Media" in large red letters, to wear, making them easily identifiable in the crowd. And when reporters began listening to comments, audible behind a cloth curtain, being made at a special reception with Bezos for the dinner’s sponsor they were shooed away.

During the evening, Bezos also discussed his announcement earlier in the day on Twitter that he was donating $2 billion establish a network of preschools in poorer neighborhoods and to help homeless families.

The Washington Housing Initiative, an effort to produce affordable housing in the Washington, D.C., region, was a title sponsor of the dinner. The initiative is being spearheaded by a local civic group, the Federal City Council, and JBG Smith Properties, a Chevy Chase, Maryland-based real estate investment trust that develops at least one of the sites Amazon is considering.

There were some protestors at the Hilton Thursday night picketing about their concern that if Amazon does choose the city of Washington for HQ2, it could end up raising rental prices and displacing lower- and middle-income residents.

Quotable Bezos:

>> "The secret sauce to Amazon -- there are so many principles at Amazon -- but the No. 1 thing by far is the incessant, compulsive focus on the customer as opposed to obsession over the competitor."

>> "I do carry cash and I do have credit cards."

>> "If I can make three good decisions a day, that's enough."

>>"Everything I’ve ever done has started small ... It’s hard to remember for you guys, but for me it’s like yesterday I was driving the packages to the post office myself and hoping one day we could afford a forklift."

>> "I know when I’m 90, it’s going to be one of the things I’m most proud is I took on The Washington Post and helped them through a very rough transition."

>> "It’s really dangerous to demonize the media. It’s dangerous to call the media lowlifes. It’s dangerous to say they’re the enemy of the people."

>> "I can’t maintain unhappiness."

>> "We buy a bunch of companies every year and I’m always trying to assess when I meet the entrepreneur who founded the company, I’m always trying to figure out one thing first and foremost: Is that person a missionary or a mercenary? The mercenary is trying to flip their stock, the missionaries love their product or their service and love their customer."

Linda Moss, Northern New Jersey Market Reporter  CoStar Group   
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